Convert AVI to IFO

It is certainly possible to convert Audio Video Interleave Files directly to DVD-Video Disc Information Files (.avi to .ifo conversion), although your options are somewhat limited. It is, however, not a single file conversion, it is rather a process, which generates numerous DVD specific file types (VOB, IFO etc.) in a proper file structure from single video files, in this case AVI. This is useful for burning DVDs.

It seems your best bet would be using Wondershare DVD Creator, as it lets users import AVI videos and transform them to IFO format.

The resulting quality will heavily depend on the original file. In case your video file is heavily compressed, its quality is typically lower.